KIRBY CORP

Previous wording

Cash provided by operating activities for the 2025 first six months decreased in comparison to the 2024 first six months primarily due to unfavorable working capital changes driven by the timing of accounts receivable collections, accounts payable payments and federal income tax payments, as well as an increase in inventories in the first half of 2025, partially offset by increased net earnings. The increase in inventories was due to the impact of higher business activity levels and supply delays in KDS resulting in the buildup of inventory for projects, mainly due to power generation orders, which are scheduled to be delivered later in 2025 and into 2026. For the 2025 first six months, capital expenditures of $150.2 million included $126.3 million in KMT and $23.9 million in KDS and corporate, each more fully described under Cash Flow and Capital Expenditures below.

Current wording

Cash provided by operating activities for the 2025 first nine months decreased in comparison to the 2024 first nine months primarily due to unfavorable working capital changes driven by the timing of accounts receivable collections, accounts payable payments and federal income tax payments, as well as an increase in inventories in the first nine months of 2025, partially offset by increased net earnings. The increase in inventories was due to the impact of higher business activity levels and supply delays in KDS resulting in the buildup of inventory for projects, mainly due to power generation orders, which are scheduled to be delivered later in 2025 and into 2026. For the 2025 first nine months, capital expenditures of $217.4 million included $186.5 million in KMT and $30.9 million in KDS and corporate, each more fully described under Cash Flow and Capital Expenditures below.

Previous wording

The Company projects that capital expenditures for 2025 will be in the $260 million to $290 million range. Approximately $180 million to $210 million is associated with marine maintenance capital and improvements to existing inland and coastal marine equipment, and facility improvements. Approximately $80 million is associated with growth capital spending in both segments.

Current wording

The Company projects that capital expenditures for 2025 will be in the $260 million to $290 million range. Approximately $180 million to $210 million is associated with marine maintenance capital and improvements to existing inland and coastal marine equipment, and facility improvements. Up to approximately $80 million is associated with growth capital spending in both segments.

Previous wording

The Company’s debt-to-capitalization ratio increased to 24.8% at June 30, 2025 compared to 20.7% at December 31, 2024, primarily due to an increase in debt outstanding. Total equity at June 30, 2025 increased as compared to December 31, 2024 primarily from net earnings attributable to Kirby of $170.3 million, partially offset by treasury stock purchases of $132.7 million. The Company’s debt outstanding as of June 30, 2025 and December 31, 2024 is detailed in Long-Term Financing below.

Current wording

The Company’s debt-to-capitalization ratio increased to 23.8% at September 30, 2025 compared to 20.7% at December 31, 2024, primarily due to an increase in debt outstanding. Total equity at September 30, 2025 increased as compared to December 31, 2024 primarily from net earnings attributable to Kirby of $262.8 million, partially offset by treasury stock purchases of $252.6 million. The Company’s debt outstanding as of September 30, 2025 and December 31, 2024 is detailed in Long-Term Financing below.

Previous wording

For the 2025 second quarter and first six months, KMT generated 58% and 59%, respectively, of the Company’s revenues compared to 59% for both the 2024 second quarter and first six months. The segment’s customers include many of the major petrochemical and refining companies that operate in the United States. Products transported include intermediate materials used to produce many of the end products used widely by businesses and consumers — plastics, fiber, paints, detergents, oil additives and paper, among others, as well as residual fuel oil, ship bunkers, asphalt, gasoline, diesel fuel, heating oil, crude oil, natural gas condensate, and agricultural chemicals. Consequently, KMT is directly affected by the volumes produced by the Company’s petroleum, petrochemical, and refining customer base.

Current wording

For the 2025 third quarter and first nine months, KMT generated 56% and 58%, respectively, of the Company’s revenues compared to 58% and 59% for the 2024 third quarter and first nine months, respectively. The segment’s customers include many of the major petrochemical and refining companies that operate in the United States. Products transported include intermediate materials used to produce many of the end products used widely by businesses and consumers — plastics, fiber, paints, detergents, oil additives and paper, among others, as well as residual fuel oil, ship bunkers, asphalt, gasoline, diesel fuel, heating oil, crude oil, natural gas condensate, and agricultural chemicals. Consequently, KMT is directly affected by the volumes produced by the Company’s petroleum, petrochemical, and refining customer base.

Previous wording

During the 2025 first six months, the Company purchased 14 inland tank barges, chartered four inland tank barges, and retired three inland tank barges, increasing its capacity by approximately 0.3 million barrels.

Current wording

During the 2025 first nine months, the Company purchased 16 inland tank barges, brought back into service three inland tank barges, and retired eight inland tank barges, increasing its capacity by approximately 0.3 million barrels.

Previous wording

KMT revenues for the 2025 second quarter and first six months increased 2% and 1%, respectively, and operating income increased 4% compared to the 2024 second quarter and first six months. The increase in revenues in the 2025 second quarter and first six months as compared to the 2024 second quarter and first six months were due to higher term and spot market pricing in the inland and coastal markets, partially offset by lower fuel rebills in both markets. The increase in operating income for the 2025 second quarter and first six months was primarily due to higher term and spot pricing in the inland and coastal markets. The 2025 and 2024 first quarters were impacted by poor operating conditions including seasonal wind and fog along the Gulf Coast and various lock closures. For the 2025 second quarter and first six months, the inland tank barge fleet contributed 81% and 82%, respectively, and the coastal fleet contributed 19% and 18% of KMT revenues, respectively. For both the 2024 second quarter and first six months, the inland tank barge fleet contributed 81% and the coastal fleet contributed 19% of KMT revenues.

Current wording

KMT revenues for both the 2025 third quarter and first nine months were flat, and operating income decreased 11% and 1%, respectively, compared to the 2024 third quarter and first nine months. Revenues for the 2025 first nine months were up 1% compared to the 2024 first nine months as higher spot and term pricing in the inland market over the 2025 first six months and higher term pricing in the coastal market for the 2025 first nine months were offset by lower fuel rebills in both inland and coastal markets. Revenues for the 2025 third quarter were flat as compared to the 2024 third quarter as lower barge utilization and moderating spot market pricing seen in the 2025 third quarter in the inland market were offset by higher term pricing in the coastal market. The decrease in operating income for the 2025 third quarter and first nine months was primarily due to lower barge utilization and moderating spot market prices in the third quarter in the inland market, partially offset by higher term pricing in the coastal market. The 2025 and 2024 first quarters were impacted by poor operating conditions including seasonal wind and fog along the Gulf Coast and various lock closures. For the 2025 third quarter and first nine months, the inland tank barge fleet contributed 78% and 80%, respectively, and the coastal fleet contributed 22% and 20% of KMT revenues, respectively. For both the 2024 third quarter and first nine months, the inland tank barge fleet contributed 81% and the coastal fleet contributed 19% of KMT revenues.

Previous wording

Inland tank barge utilization levels averaged in the low to mid-90% range during the 2025 and 2024 first and second quarters. The 2025 and 2024 first quarters were impacted by high winds and heavy fog along the Gulf Coast and lock delays. Coastal tank barge utilization levels averaged in the mid to high 90% range during the 2025 and 2024 first and second quarters.

Current wording

Inland tank barge utilization levels averaged in the low to mid-90% range during the 2025 and 2024 first and second quarters, the mid-80% range during the 2025 third quarter, and the 90% range during the 2024 third quarter. The 2025 third quarter experienced seasonally favorable weather and improved navigational conditions. In addition, the 2025 third quarter was also impacted by a lighter feedstock mix for refinery and chemical customers and fewer barges undergoing maintenance across the industry. The 2025 and 2024 first quarters were impacted by high winds and heavy fog along the Gulf Coast and lock delays. The 2024 second and third quarters were modestly impacted by weather and lock closures. Coastal tank barge utilization levels averaged in the mid to high 90% range during the 2025 and 2024 first, second, and third quarters.

Previous wording

During both the 2025 second quarter and first six months, approximately 70% of KMT inland revenues were under term contracts and 30% were spot contract revenues. During both the 2024 second quarter and first six months, approximately 65% of KMT inland revenues were under term contracts and 35% were spot contract revenues. Inland time charters during both the 2025 second quarter and first six months represented approximately 60% of inland revenues under term contracts compared with 59% and 60% in the 2024 second quarter and first six months, respectively. During both the 2025 second quarter and first six months, approximately 100% of KMT coastal revenues were under term contracts and none were under spot contracts. During the 2024 second quarter and first six months, approximately 100% and 98%, respectively, of KMT coastal revenues were under term contracts and none and 2%, respectively, were under spot contracts. Coastal time charters represented approximately 100% of coastal revenues under term contracts during both the 2025 second quarter and first six months compared to 97% during both the 2024 second quarter and first six months. Term contracts have contract terms of 12 months or longer, while spot contracts have contract terms of less than 12 months.

Current wording

During both the 2025 third quarter and first nine months, approximately 70% of KMT inland revenues were under term contracts and 30% were spot contract revenues. During both the 2024 third quarter and first nine months, approximately 65% of KMT inland revenues were under term contracts and 35% were spot contract revenues. Inland time charters during the 2025 third quarter and first nine months represented approximately 57% and 59%, respectively, of inland revenues under term contracts compared with 62% and 61% in the 2024 third quarter and first nine months, respectively. During both the 2025 third quarter and first nine months, approximately 100% of KMT coastal revenues were under term contracts and none were under spot contracts. During the 2024 third quarter and first nine months, approximately 99% and 98%, respectively, of KMT coastal revenues were under term contracts and 1% and 2%, respectively, were under spot contracts. Coastal time charters represented approximately 100% of coastal revenues under term contracts during both the 2025 third quarter and first nine months compared to 99% and 98% during the 2024 third quarter and first nine months, respectively. Term contracts have contract terms of 12 months or longer, while spot contracts have contract terms of less than 12 months.

Previous wording

KMT operating margin was 20.1% and 19.2% for the 2025 second quarter and first six months, respectively, compared to 19.6% and 18.5% for the 2024 second quarter and first six months, respectively.

Current wording

KMT operating margin was 18.3% and 18.9% for the 2025 third quarter and first nine months, respectively, compared to 20.5% and 19.2% for the 2024 third quarter and first nine months, respectively.

Previous wording

For the 2025 second quarter and first six months, KDS generated 42% and 41% of the Company’s revenues, respectively, of which 86% and 87%, respectively, were generated from service and parts and 14% and 13%, respectively, from manufacturing. The results of KDS are largely influenced by the economic cycles of the oil and gas, marine, power generation, on-highway, and other related industrial markets.

Current wording

For the 2025 third quarter and first nine months, KDS generated 44% and 42% of the Company’s revenues, respectively, of which 79% and 84%, respectively, were generated from service and parts and 21% and 16%, respectively, from manufacturing. The results of KDS are largely influenced by the economic cycles of the oil and gas, marine, power generation, on-highway, and other related industrial markets.

Previous wording

KDS revenues for the 2025 second quarter increased 7% compared with the 2024 second quarter. KDS revenues for the 2025 first six months were flat compared with the 2024 first six months. KDS operating income for the 2025 second quarter and first six months increased 20% and 13%, respectively, compared with the 2024 second quarter and first six months. In the commercial and industrial market, revenues and operating income increased compared to the 2024 second quarter and first six months due to higher business levels in marine repair. For the 2025 second quarter and first six months, the commercial and industrial market contributed 48% and 50% of KDS revenues, respectively.

Current wording

KDS revenues for the 2025 third quarter and first nine months increased 12% and 4%, respectively, compared with the 2024 third quarter and first nine months. KDS operating income for the 2025 third quarter and first nine months increased 40% and 23%, respectively, compared with the 2024 third quarter and first nine months. In the commercial and industrial market, revenues and operating income increased compared to the 2024 third quarter and first nine months due to higher business levels in marine repair. For the 2025 third quarter and first nine months, the commercial and industrial market contributed 44% and 47% of KDS revenues, respectively.

Previous wording

In the power generation market, revenues increased compared to the 2024 second quarter and first six months due to increased demand for backup and critical power applications, while operating income decreased due to sales mix. For the 2025 second quarter and first six months, the power generation market contributed 39% and 36% of KDS revenues, respectively.

Current wording

In the power generation market, revenues and operating income increased compared to the 2024 third quarter and first nine months due to increased demand for backup and critical power applications. For the 2025 third quarter and first nine months, the power generation market contributed 45% and 40% of KDS revenues, respectively.

Previous wording

In the oil and gas market, revenues decreased compared to the 2024 second quarter and first six months, impacted by lower levels of conventional oilfield activity which resulted in decreased demand for new transmissions and parts, partially offset by deliveries of electric fracturing equipment. Operating income in the oil and gas market increased compared to the 2024 second quarter and first six months due to product mix and ongoing cost management initiatives. For the 2025 second quarter and first six months, the oil and gas market contributed 13% and 14% of KDS revenues, respectively.

Current wording

In the oil and gas market, revenues decreased compared to the 2024 third quarter and first nine months, impacted by lower levels of conventional oilfield activity which resulted in decreased demand for new transmissions and parts, partially offset by deliveries of electric fracturing equipment. Operating income in the oil and gas market increased compared to the 2024 third quarter and first nine months due to product mix and ongoing cost management initiatives. For the 2025 third quarter and first nine months, the oil and gas market contributed 11% and 13% of KDS revenues, respectively.

Previous wording

KDS operating margin was 9.8% and 8.6% for the 2025 second quarter and first six months, respectively, compared to 8.7% and 7.7% for the 2024 second quarter and first six months, respectively.

Current wording

KDS operating margin was 11.0% and 9.5% for the 2025 third quarter and first nine months, respectively, compared to 8.8% and 8.0% for the 2024 third quarter and first nine months, respectively.

Previous wording

Overall, the Company expects to deliver improved financial results in 2025. In KMT, barge utilization and customer demand remain favorable and rates continue to increase. In KDS, growth in the power generation market is expected to offset softness in oil and gas markets, and the on-highway service and repair business due to the ongoing trucking recession. The Company remains mindful of the ever-changing economic landscape related to the possible impact of high interest rates, tariffs and possible recessionary headwinds as it moves through 2025.

Current wording

Overall, the Company expects to deliver improved financial results in 2025. In KMT, the Company expects barge utilization rates in the 2025 fourth quarter to improve over the 2025 third quarter. The coastal marine market conditions remain very favorable. In KDS, growth in the power generation market is expected to offset softness in oil and gas markets, and the on-highway service and repair business continues to modestly improve despite the ongoing trucking recession. The Company remains mindful of the ever-changing economic landscape related to the possible impact of high interest rates, tariffs and possible recessionary headwinds as it moves through the 2025 fourth quarter and into 2026.

Previous wording

In the inland marine transportation market in 2025, the Company anticipates positive market dynamics due to limited new barge construction. The Company expects barge utilization rates to remain steady for the remainder of the year. Also, the Company continues to see inflationary pressures and there remains an acute mariner shortage in the industry which continues to drive up labor costs. These pressures, along with the increasing cost of equipment, should continue to put upward pressure on term contract prices. In the near term, however, spot market pricing could be pressured due to short-term demand softness. In the coastal marine transportation market in 2025, market conditions remain very favorable with steady customer demand. This is expected to keep barge utilization at high levels with improved rates as the availability of equipment is limited across the industry given there are currently no new ATBs under construction.

Current wording

In the inland marine transportation market for the remainder of 2025, the Company continues to see inflationary pressures persisting which continue to drive up operating costs. These continuing cost pressures, along with limited new barge construction and the increasing cost of equipment, should continue to put upward pressure on prices over the long-term. In the near term, however, term and spot market pricing could face headwinds if short-term market softness experienced in the 2025 third quarter re-emerges. In the coastal marine transportation market in 2025, market conditions remain very favorable with steady customer demand. This is expected to keep barge utilization at high levels with improved rates as the availability of equipment is limited across the industry given there are currently no new ATBs under construction.

Previous wording

The Company expects mixed results in KDS in 2025 as near-term volatility from supply issues, customers deferring maintenance, and lower overall levels of activity in the oil and gas market to be offset by increased orders in the power generation market. In commercial and industrial, the demand outlook in marine repair remains steady while on-highway service and repair remains soft but has shown some recent modest improvement. In power generation, the Company anticipates continued strong growth in orders as data center demand and the need for backup power continues to be strong. In oil and gas, the Company expects revenues to be down as the transition from conventional diesel hydraulic fracturing to electric hydraulic fracturing continues to take place. The Company anticipates extended lead times and supply delays for certain original equipment manufacturer products to continue throughout 2025.

Current wording

The Company expects improved results in KDS in 2025 driven by increased orders in the power generation market, partially offset by near-term volatility from supply issues, customers deferring maintenance, and lower overall levels of activity in the oil and gas market. In commercial and industrial, the demand outlook in marine repair remains steady while on-highway service and repair remains soft but has shown some recent modest improvement. In power generation, the Company anticipates continued strong growth in orders as data center demand and the need for backup power continues to be strong. In oil and gas, the Company expects revenues to be down as the transition from conventional diesel hydraulic fracturing to electric hydraulic fracturing continues to take place. The Company anticipates extended lead times and supply delays for certain original equipment manufacturer products to continue in the 2025 fourth quarter and into 2026.

Previous wording

KMT revenues for the 2025 second quarter and first six months increased 2% and 1%, respectively, and operating income increased 4% compared to the 2024 second quarter and first six months. The increase in revenues in the 2025 second quarter and first six months as compared to the 2024 second quarter and first six months were due to higher term and spot market pricing in the inland and coastal markets, partially offset by lower fuel rebills in both markets. The increase in operating income for the 2025 second quarter and first six months was primarily due to higher term and spot pricing in the inland and coastal markets. The 2025 and 2024 first quarters were impacted by poor operating conditions including seasonal wind and fog along the Gulf Coast and various lock closures. For the 2025 second quarter and first six months, the inland tank barge fleet contributed 81% and 82%, respectively, and the coastal fleet contributed 19% and 18% of KMT revenues, respectively. For both the 2024 second quarter and first six months, the inland tank barge fleet contributed 81% and the coastal fleet contributed 19% of KMT revenues.

Current wording

KMT revenues for both the 2025 third quarter and first nine months were flat, and operating income decreased 11% and 1%, respectively, compared to the 2024 third quarter and first nine months. Revenues for the 2025 first nine months were up 1% compared to the 2024 first nine months as higher spot and term pricing in the inland market over the 2025 first six months and higher term pricing in the coastal market for the 2025 first nine months were offset by lower fuel rebills in both inland and coastal markets. Revenues for the 2025 third quarter were flat as compared to the 2024 third quarter as lower barge utilization and moderating spot market pricing seen in the 2025 third quarter in the inland market were offset by higher term pricing in the coastal market. The decrease in operating income for the 2025 third quarter and first nine months was primarily due to lower barge utilization and moderating spot market prices in the third quarter in the inland market, partially offset by higher term pricing in the coastal market. The 2025 and 2024 first quarters were impacted by poor operating conditions including seasonal wind and fog along the Gulf Coast and various lock closures. For the 2025 third quarter and first nine months, the inland tank barge fleet contributed 78% and 80%, respectively, and the coastal fleet contributed 22% and 20% of KMT revenues, respectively. For both the 2024 third quarter and first nine months, the inland tank barge fleet contributed 81% and the coastal fleet contributed 19% of KMT revenues.

Previous wording

Inland tank barge utilization levels averaged in the low to mid-90% range during the 2025 and 2024 first and second quarters. The 2025 and 2024 first quarters were impacted by high winds and heavy fog along the Gulf Coast and lock delays. Coastal tank barge utilization levels averaged in the mid to high 90% range during the 2025 and 2024 first and second quarters.

Current wording

Inland tank barge utilization levels averaged in the low to mid-90% range during the 2025 and 2024 first and second quarters, the mid-80% range during the 2025 third quarter, and the 90% range during the 2024 third quarter. The 2025 third quarter experienced seasonally favorable weather and improved navigational conditions. In addition, the 2025 third quarter was also impacted by a lighter feedstock mix for refinery and chemical customers and fewer barges undergoing maintenance across the industry. The 2025 and 2024 first quarters were impacted by high winds and heavy fog along the Gulf Coast and lock delays. The 2024 second and third quarters were modestly impacted by weather and lock closures. Coastal tank barge utilization levels averaged in the mid to high 90% range during the 2025 and 2024 first, second, and third quarters.

Previous wording

The petrochemical market, which is the Company’s largest market, contributed 49% of KMT revenues for both the 2025 second quarter and first six months reflecting steady rates, volumes and utilization from Gulf Coast petrochemical plants as compared to the 2024 second quarter and first six months.

Current wording

The petrochemical market, which is the Company’s largest market, contributed 48% and 49% of KMT revenues for the 2025 third quarter and first nine months, respectively, reflecting steady rates, volumes and utilization from Gulf Coast petrochemical plants as compared to the 2024 third quarter and first nine months.

Previous wording

The black oil market, which contributed 26% of KMT revenues for both the 2025 second quarter and first six months reflected stable demand as refinery utilization and production levels of refined petroleum products and fuel oils increased. During the 2025 first six months, the Company transported crude oil and natural gas condensate produced from major U.S. shale basins along the Gulf Intracoastal Waterway with inland vessels and in the Gulf of America with coastal equipment. Additionally, the Company transported volumes of Utica natural gas condensate downriver from the Mid-Atlantic to the Gulf Coast.

Current wording

The black oil market, which contributed 25% and 26% of KMT revenues for the 2025 third quarter and first nine months, respectively, reflected stable demand as refinery utilization and production levels of refined petroleum products and fuel oils increased. During the 2025 first nine months, the Company transported crude oil and natural gas condensate produced from major U.S. shale basins along the Gulf Intracoastal Waterway with inland vessels and in the Gulf of America with coastal equipment. Additionally, the Company transported volumes of Utica natural gas condensate downriver from the Mid-Atlantic to the Gulf Coast.

Previous wording

The refined petroleum products market, which contributed 21% of KMT revenues for both the 2025 second quarter and first six months, reflected stable volumes in the inland market with steady refinery utilization and product levels as compared to the 2024 second quarter and first six months.

Current wording

The refined petroleum products market, which contributed 24% and 22% of KMT revenues for the 2025 third quarter and first nine months, respectively, reflected stable volumes in the inland market with steady refinery utilization and product levels as compared to the 2024 third quarter and first nine months.

Previous wording

The agricultural chemical market, which contributed 4% of KMT revenues for both the 2025 second quarter and first six months reflected stable demand for transportation of both domestically produced and imported products as compared to the 2024 second quarter and first six months.

Current wording

The agricultural chemical market, which contributed 3% of KMT revenues for both the 2025 third quarter and first nine months reflected stable demand for transportation of both domestically produced and imported products as compared to the 2024 third quarter and first nine months.

Previous wording

For the 2025 second quarter, inland operations incurred 3,320 delay days compared to 3,334 delay days that occurred during the 2024 second quarter. For the 2025 first six months, inland operations incurred 7,349 delay days, 7% more than the 6,841 delay days that occurred during the 2024 first six months. Delay days measure the lost time incurred by a tow (towboat and one or more tank barges) during transit when the tow is stopped due to weather, lock conditions, or other navigational factors. Delay days reflected poor operating conditions due to heavy wind and fog along the Gulf Coast and lock delays during the 2025 and 2024 first quarters.

Current wording

For the 2025 third quarter, inland operations incurred 1,442 delay days, 30% fewer than the 2,061 delay days that occurred during the 2024 third quarter. For the 2025 first nine months, inland operations incurred 8,791 delay days, 1% fewer than the 8,902 delay days that occurred during the 2024 first nine months. Delay days measure the lost time incurred by a tow (towboat and one or more tank barges) during transit when the tow is stopped due to weather, lock conditions, or other navigational factors. Delay days reflected very favorable seasonal weather and improved navigational conditions in the 2025 third quarter, and poor operating conditions due to heavy wind and fog along the Gulf Coast and lock delays during the 2025 and 2024 first quarters.

Previous wording

During both the 2025 second quarter and first six months, approximately 70% of KMT inland revenues were under term contracts and 30% were spot contract revenues. During both the 2024 second quarter and first six months, approximately 65% of KMT inland revenues were under term contracts and 35% were spot contract revenues. Inland time charters during both the 2025 second quarter and first six months represented approximately 60% of inland revenues under term contracts compared with 59% and 60% in the 2024 second quarter and first six months, respectively. During both the 2025 second quarter and first six months, approximately 100% of KMT coastal revenues were under term contracts and none were under spot contracts. During the 2024 second quarter and first six months, approximately 100% and 98%, respectively, of KMT coastal revenues were under term contracts and none and 2%, respectively, were under spot contracts. Coastal time charters represented approximately 100% of coastal revenues under term contracts during both the 2025 second quarter and first six months compared to 97% during both the 2024 second quarter and first six months. Term contracts have contract terms of 12 months or longer, while spot contracts have contract terms of less than 12 months.

Current wording

During both the 2025 third quarter and first nine months, approximately 70% of KMT inland revenues were under term contracts and 30% were spot contract revenues. During both the 2024 third quarter and first nine months, approximately 65% of KMT inland revenues were under term contracts and 35% were spot contract revenues. Inland time charters during the 2025 third quarter and first nine months represented approximately 57% and 59%, respectively, of inland revenues under term contracts compared with 62% and 61% in the 2024 third quarter and first nine months, respectively. During both the 2025 third quarter and first nine months, approximately 100% of KMT coastal revenues were under term contracts and none were under spot contracts. During the 2024 third quarter and first nine months, approximately 99% and 98%, respectively, of KMT coastal revenues were under term contracts and 1% and 2%, respectively, were under spot contracts. Coastal time charters represented approximately 100% of coastal revenues under term contracts during both the 2025 third quarter and first nine months compared to 99% and 98% during the 2024 third quarter and first nine months, respectively. Term contracts have contract terms of 12 months or longer, while spot contracts have contract terms of less than 12 months.

Previous wording

Costs and expenses for both the 2025 second quarter and first six months were flat compared to the 2024 second quarter and first six months. Costs of sales and operating expenses for the 2025 second quarter and first six months were flat and decreased 2%, respectively, compared with the 2024 second quarter and first six months. The results for the 2025 second quarter and first six months were driven by lower fuel costs, offset by inflationary cost pressures including wage increases that went into effect in 2024.

Current wording

Costs and expenses for both the 2025 third quarter and first nine months increased 3% and 1%, respectively, compared to the 2024 third quarter and first nine months. Costs of sales and operating expenses for the 2025 third quarter and first nine months were flat compared with the 2024 third quarter and first nine months. The results for the 2025 third quarter and first nine months were driven by inflationary cost pressures including wage increases that went into effect on July 1, 2025. Fuel costs were slightly higher in the 2025 third quarter as compared to the 2024 third quarter but lower in the 2025 first nine months as compared to the 2024 first nine months.

Previous wording

The inland marine transportation fleet operated an average of 290 towboats during the 2025 second quarter, of which an average of 75 were chartered, compared to 287 during the 2024 second quarter, of which an average of 74 were chartered. The Company charters in or releases chartered towboats in an effort to balance horsepower needs with current requirements, taking into account variability in demand or anticipated demand, addition or removal of tank barges from the fleet, chartered towboat availability, and weather or water conditions. The Company has historically used chartered towboats for approximately one-fourth of its horsepower requirements.

Current wording

The inland marine transportation fleet operated an average of 270 towboats during the 2025 third quarter, of which an average of 61 were chartered, compared to 287 during the 2024 third quarter, of which an average of 71 were chartered. The Company charters in or releases chartered towboats in an effort to balance horsepower needs with current requirements, taking into account variability in demand or anticipated demand, addition or removal of tank barges from the fleet, chartered towboat availability, and weather or water conditions. The Company has historically used chartered towboats for approximately one-fourth of its horsepower requirements.

Previous wording

During the 2025 second quarter, inland operations consumed 12.8 million gallons of diesel fuel compared to 12.1 million gallons consumed during the 2024 second quarter. The average price per gallon of diesel fuel consumed during the 2025 second quarter was $2.35 per gallon compared with $2.83 per gallon for the 2024 second quarter. During the 2025 first six months, inland operations consumed 24.5 million gallons of diesel fuel compared to 24.0 million gallons consumed during the 2024 first six months. The average price per gallon of diesel fuel consumed during the 2025 first six months was $2.45 per gallon compared with $2.83 per gallon for the 2024 first six months. Fuel escalation and de-escalation clauses are typically included in term contracts and are designed to rebate fuel costs when prices decline and recover additional fuel costs when fuel prices rise; however, there is generally a 30 to 120 day delay before contracts are adjusted. Spot contracts do not have escalators for fuel.

Current wording

During the 2025 third quarter, inland operations consumed 12.5 million gallons of diesel fuel compared to 11.3 million gallons consumed during the 2024 third quarter. The average price per gallon of diesel fuel consumed during the 2025 third quarter was $2.46 per gallon compared with $2.65 per gallon for the 2024 third quarter. During the 2025 first nine months, inland operations consumed 37.0 million gallons of diesel fuel compared to 35.3 million gallons consumed during the 2024 first nine months. The average price per gallon of diesel fuel consumed during the 2025 first nine months was $2.46 per gallon compared with $2.77 per gallon for the 2024 first nine months. Fuel escalation and de-escalation clauses are typically included in term contracts and are designed to rebate fuel costs when prices decline and recover additional fuel costs when fuel prices rise; however, there is generally a 30 to 120 day delay before contracts are adjusted. Spot contracts do not have escalators for fuel.

Previous wording

Selling, general and administrative expenses for the 2025 second quarter and first six months increased 3% and 6%, respectively, compared to the 2024 second quarter and first six months. The increase in selling, general and administrative expenses for the 2025 second quarter and first six months as compared to the 2024 second quarter and first six months was primarily due to salary and wage increases that went into effect on July 1, 2024 and continued inflationary cost pressures. The 2025 first six months was also impacted by an increase in the provision for credit losses related to a certain customer during the 2025 first quarter.

Current wording

Selling, general and administrative expenses for the 2025 third quarter and first nine months increased 3% and 5%, respectively, compared to the 2024 third quarter and first nine months. The increase in selling, general and administrative expenses for the 2025 third quarter and first nine months as compared to the 2024 third quarter and first nine months was primarily due to continued inflationary cost pressures, including higher medical costs, and salary and wage increases that went into effect on July 1, 2025. The 2025 first nine months was also impacted by an increase in the provision for credit losses related to a certain customer during the 2025 first quarter.

Previous wording

Depreciation and amortization for both the 2025 second quarter and first six months increased 8% compared to the 2024 second quarter and first six months. The increase was primarily due to capital additions during 2024 and the first six months of 2025, as well as equipment acquisitions.

Current wording

Depreciation and amortization for both the 2025 third quarter and first nine months increased 8% compared to the 2024 third quarter and first nine months. The increase was primarily due to capital additions during 2024 and the first nine months of 2025, as well as equipment acquisitions.

Previous wording

KMT operating income for both the 2025 second quarter and first six months increased 4% compared with the 2024 second quarter and first six months. The 2025 second quarter operating margin was 20.1% compared with 19.6% for the 2024 second quarter. The 2025 first six months operating margin was 19.2% compared with 18.5% for the 2024 first six months. The increases in operating income and operating margin were primarily due to higher term and spot contract pricing in the inland and coastal markets.

Current wording

KMT operating income for the 2025 third quarter and first nine months decreased 11% and 1% compared with the 2024 third quarter and first nine months, respectively. The 2025 third quarter operating margin was 18.3% compared with 20.5% for the 2024 third quarter. The 2025 first nine months operating margin was 18.9% compared with 19.2% for the 2024 first nine months. The decrease in operating income and operating margin were primarily due to lower barge utilization and moderating spot market prices in the inland market in the 2025 third quarter, partially offset by higher term pricing in the coastal market.

Previous wording

KDS revenues for the 2025 second quarter increased 7% compared with the 2024 second quarter. KDS revenues for the 2025 first six months were flat compared with the 2024 first six months. KDS operating income for the 2025 second quarter and first six months increased 20% and 13%, respectively, compared with the 2024 second quarter and first six months.

Current wording

KDS revenues for the 2025 third quarter and first nine months increased 12% and 4%, respectively, compared with the 2024 third quarter and first nine months. KDS operating income for the 2025 third quarter and first nine months increased 40% and 23%, respectively, compared with the 2024 third quarter and first nine months.

Previous wording

In the commercial and industrial market, revenues and operating income increased compared to the 2024 second quarter and first six months due to higher business levels in marine repair. In the power generation market, revenues increased compared to the 2024 second quarter and first six months due to increased demand for backup and critical power applications, while operating income decreased due to sales mix. In the oil and gas market, revenues decreased compared to the 2024 second quarter and first six months, impacted by lower levels of conventional oilfield activity which resulted in decreased demand for new transmissions and parts, partially offset by deliveries of electric fracturing equipment. Operating income in the oil and gas market increased compared to the 2024 second quarter and first six months due to product mix and ongoing cost management initiatives.

Current wording

In the commercial and industrial market, revenues and operating income increased compared to the 2024 third quarter and first nine months due to higher business levels in marine repair. In the power generation market, revenues and operating income increased compared to the 2024 third quarter and first nine months due to increased demand for backup and critical power applications. In the oil and gas market, revenues decreased compared to the 2024 third quarter and first nine months, impacted by lower levels of conventional oilfield activity which resulted in decreased demand for new transmissions and parts, partially offset by deliveries of electric fracturing equipment. Operating income in the oil and gas market increased compared to the 2024 third quarter and first nine months due to product mix and ongoing cost management initiatives.

Previous wording

Costs and expenses for the 2025 second quarter and first six months increased 6% and decreased 1%, respectively, compared with the 2024 second quarter and first six months. Costs of sales and operating expenses for the 2025 second quarter and first six months increased 4% and decreased 3%, respectively, compared with the 2024 second quarter and first six months. The increase for the 2025 second quarter reflected higher deliveries of power generation equipment, while the decrease for the 2025 first six months reflected lower on-highway and conventional oilfield activity as well as fewer power generation equipment shipments in the 2025 first quarter due to supply delays.

Current wording

Costs and expenses for the 2025 third quarter and first nine months increased 9% and 2%, respectively, compared with the 2024 third quarter and first nine months. Costs of sales and operating expenses for the 2025 third quarter and first nine months increased 9% and 1%, respectively, compared with the 2024 third quarter and first nine months. The increase for the 2025 third quarter and first nine months reflected higher deliveries of power generation equipment, partially offset by lower on-highway and conventional oilfield activity.

Previous wording

Selling, general and administrative expenses for the 2025 second quarter and first six months increased 9% and 5% compared to the 2024 second quarter and first six months, reflecting salary and wage increases that went into effect July 1, 2024 and higher business activity levels.

Current wording

Selling, general and administrative expenses for the 2025 third quarter and first nine months increased 5% compared to the 2024 third quarter and first nine months, reflecting higher business activity levels, inflationary cost pressures, including higher medical costs, and salary and wage increases that went into effect July 1, 2025.

Previous wording

Depreciation and amortization for the 2025 second quarter and first six months increased 24% and 28%, respectively, compared to the 2024 second quarter and first six months. The increase was primarily due to capital additions during 2024 and the first six months of 2025 including additions to the equipment rental fleet.

Current wording

Depreciation and amortization for the 2025 third quarter and first nine months increased 23% and 26%, respectively, compared to the 2024 third quarter and first nine months. The increase was primarily due to capital additions during 2024 and the first nine months of 2025 including additions to the equipment rental fleet.

Previous wording

KDS operating income for the 2025 second quarter and first six months increased 20% and 13%, respectively, compared with the 2024 second quarter and first six months. The 2025 second quarter operating margin was 9.8% compared to 8.7% for the 2024 second quarter. The 2025 first six months operating margin was 8.6% compared to 7.7% for the 2024 first six months. The results reflect increased marine repair activity and deliveries of electric fracturing equipment, partially offset by lower conventional oilfield activity.

Current wording

KDS operating income for the 2025 third quarter and first nine months increased 40% and 23%, respectively, compared with the 2024 third quarter and first nine months. The 2025 third quarter operating margin was 11.0% compared to 8.8% for the 2024 third quarter. The 2025 first nine months operating margin was 9.5% compared to 8.0% for the 2024 first nine months. The results reflect increased demand in power generation from data centers and prime power customers and higher marine repair activity and deliveries of electric fracturing equipment, partially offset by lower conventional oilfield activity.

Previous wording

The Company reported a net gain on disposition of assets of $1.7 million and $0.5 million for the 2025 and 2024 second quarters, respectively. The Company reported a net gain on disposition of assets of $1.8 million and $0.6 million for the 2025 and 2024 first six months, respectively. The net gains were primarily from sales of marine transportation equipment.

Current wording

The Company reported a net gain on disposition of assets of $3.0 million and $1.6 million for the 2025 and 2024 third quarters, respectively. The Company reported a net gain on disposition of assets of $4.8 million and $2.2 million for the 2025 and 2024 first nine months, respectively. The net gains were primarily from sales of marine transportation equipment.

Previous wording

Other income for the 2025 and 2024 second quarters includes income of $4.3 million and $2.7 million, respectively, and the 2025 and 2024 first six months includes income of $9.1 million and $5.1 million, respectively, for all components of net benefit costs except the service cost component related to the Company’s defined benefit plans.

Current wording

Other income for the 2025 and 2024 third quarters includes income of $4.6 million and $2.6 million, respectively, and the 2025 and 2024 first nine months includes income of $13.7 million and $7.7 million, respectively, for all components of net benefit costs except the service cost component related to the Company’s defined benefit plans.

Previous wording

Interest expense for the 2025 second quarter and first six months decreased 1% and 10%, respectively, compared with the 2024 second quarter and first six months, primarily due to a lower average interest rate in the 2025 second quarter and first six months. Interest expense excludes capitalized interest for the 2025 first six months of $0.5 million. There was no capitalized interest excluded from interest expense during the 2024 first six months.

Current wording

Interest expense for the 2025 third quarter and first nine months decreased 5% and 9%, respectively, compared with the 2024 third quarter and first nine months, primarily due to a lower average interest rate in the 2025 third quarter and first nine months. Interest expense excludes capitalized interest for the 2025 third quarter and first nine months of $0.3 million and $0.8 million, respectively. There was no capitalized interest excluded from interest expense during the 2024 first nine months.